Indian swap rates fall, rupee gains after RBI cuts repo rate, CRR

MUMBAI

MUMBAI Jan 29 Indian swap rates fell while the
rupee strengthened after the central bank cut interest rates by
25 basis points as expected, while also delivering a surprise
cut in the cash reserve ratio.

The 1-year overnight index swap (OIS) rate,
which is also sensitive to liquidity conditions, fell 5 basis
points (bps) to 7.54 percent from levels before the decision.
The 5-year OIS rate fell 3 bps to 7.14 percent,
according to traders.

The Indian rupee strengthened to 53.79 from around
53.84 before the decision, while the NSE's banking sub-index
was up 0.3 percent.

The 10-year bond yield was down 1 bp as the
cut in the cash reserve ratio reduced the prospects of bond
purchases via open market operations.
(Reporting by Mumbai markets team; Editing by Anand Basu)

Trending On Reuters

Markets Weekahead

With the Nifty breaching 8,500, sentiments are again bullish. But markets have been in the 8,200-8,600 range for some time and stocks across the board do not give the required confidence except for the liquidity factor. Many frontline stocks are not participating on the upside and the core sector is in a downtrend, writes Ambareesh Baliga. Column